Residency or citizenship? Which programme suits you?
12 November 2018
By Sandra Woest
A Second Citizenship/Residence Permit is now a necessary component of one’s Global Legacy.
Holding a second passport or even a residence permit from another country is similar to holding a life insurance policy. You hope you never have to use it, but should the need arise you are certainly glad you had the foresight to ensure your family is well protected. In today’s ever-changing world, it is not only smart but also prudent to have a backup plan for your family and a second citizenship or residence permit forms part of this plan.
We are seeing an increase in offshore investment in stable currencies which can be done with a second residence or citizenship, not only securing your family’s financial legacy, but also their freedom of movement.
Citizenship vs Residence by Investment Programmes
Many countries offer Residence-by-Investment Programmes (RBI’s) including Australia, Canada, New Zealand, Portugal, the UK and the USA. Essentially, you make an investment in the country and in return, you receive a residence permit or visa. The type of investment can vary between passive investments in government bonds or real estate, or be active investments in a business. Programmes also vary greatly in terms of their flexibility with some such as Greece, Malta and Portugal requiring very little physical presence, in order to maintain the residence status. Whereas other programmes offered by Canada, UK and USA are intended for the applicant and family to move to the country and live there full time. The length of time that should be spent in the country in order to qualify for citizenship varies from 5 to 20 years.
Why are Private Clients seeking an alternative residence?
- Security – a safe alternative country in times of domestic or geo-political instability
- Education – increased educational opportunities in a first world country
- Tax Planning – more efficient and prudent financial planning
- Quality of Life – better overall lifestyle, climate and business atmosphere. This also includes cleaner environments, progressive cultures and access to superior healthcare etc.
- Travel – freedom to travel visa free to many significant countries (EU Programmes)
Generally speaking, Citizenship-by-Investment Programmes (CBI) require an applicant to make a significant investment or contribution to a country in return for citizenship with little or even no residence requirements. The qualifying investment is dependent on the country with some permitting real estate to qualify while others require a non-recoverable contribution or a combination of the two.
CBI programmes are ideally suited for those wishing to remain living in their home country but want to obtain a second citizenship/passport and all of the benefits that accompany it, including visa-free travel to over 130 countries and the assurance of being able to swiftly leave should the political or social environment suddenly become precarious. While typically more expensive than RBI programmes, CBI’s come with increased benefits including the right to live and work in multiple countries.
We have seen a sharp increase in demand for CBI programmes which has resulted in more countries offering them. The two EU CBI programmes are found in Cyprus and Malta while the five Caribbean programmes are Antigua & Barbuda, Dominica, Grenada, St Kitts & Nevis and St Lucia. Other programmes include Vanuatu and Turkey although their popularity remains tepid. In addition, we expect Moldova and Montenegro to be launching CBI programmes in 2019.
The CBI programmes afford all of the benefits of the RBI’s plus many others including;
- Ultimate Plan B – no need to relocate to another country but you gain the right to do so, if the need ever arises.
- Mitigate Risk – including political, economic and social instability
- Global Legacy – providing more options in life for one’s family
- Mobility - greater visa free travel ensuring there is no longer the need to spend time and money on visa applications
- Multiple Passports – no need to rely on one passport for your global affairs
- State Protection – another country sworn to protect you and your family
- Retirement – the option to retire in another country with a more appealing climate
- Flexibility – travelling on a second passport from a small friendly nation making you less of a target from terrorism or even religious/political persecution
- Business Opportunities – gain access to new markets
- Succession Planning – optimizing for the benefit of one’s family
Which type of programme is best suited for your needs? Contact me today for a free and in-depth consultation and review of your options.